Royal Dutch Shell: Risks in Transnational Markets

Abstract

The case discusses the problems that Anglo Dutch oil major Royal Dutch Shell was facing in a few of the markets in which it was operating as of 2014. The oil industry in general has been involved in international operations for over a century and over the years it had witnessed several risks associated with operating in several countries at the same time. Shell, with operations in more than 70 countries across the world, faced several problems due to its business practices, technologies, and the environment in which it was operating.

The case looks at some of its pressing problems and the huge impact they have had on Shell’s operations. These include its operations in Nigeria, where it was the victim of theft and pilferage of oil which caused huge losses to it; its Arctic venture, where it faced technical difficulties as well as issues with local environment conservation groups; and its US shale operations, where despite huge investments, Shell did not get any returns.

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Issues

The case is structured to achieve the following teaching objectives:

Understand Shell’s international operations

Examine the challenges that Shell faced right from its inception, especially those pertaining to international expansion and operations

Evaluate the reasons due to which companies like Shell continue to explore opportunities in locations that are deemed risky

Understand different challenges Shell is presently facing in a few of its international markets

Explore the ways in which Shell can minimize the risks associated with global operations while at the same time taking advantage of the opportunities these markets provide